Trade body takes stand against ‘unfair’ bond payments

Members of the Investment Association have raised concerns over the use of consent fees to push through changes to the terms of a debt security

By

James Rundle and

Andy Pearce

April 7, 2015 Updated: 6:28 p.m. GMT

A leading trade body has issued a warning about the increasingly common practice of bond issuers only paying consent fees to investors that vote in favour of proposed amendments.

The Investment Association said that its members had raised concerns over the use of consent fees to push through changes to the terms of a debt security in recent years. Those who vote against proposals typically do not receive the payment.